Want to get fleeced?–go to church. Part 1

William Thornton, writing for AL.com (Feb. 6), reports, Forget American hustlers or Wall Street wolves-- if you want to take Alabamians' money illegally, the most common way is through churches.

That's what Joe Borg, the head of the Alabama Securities Commission for two decades, said today in a talk at the Gadsden Rotary Club. Religion is the most successful vehicle for fraud in the state--through what is known as affinity frauds--with Ponzi schemes and get-rich-quick investments preying on those who pray.

"Think about it, you've got a lot of people who are all part of the same community," Borg said. "God's supposed to be watching over your funds. And they think, Why would they take advantage of you?'"

Borg has seen and helped prosecute all kinds of phony investment scams and frauds during his time, so he has a lot of stories to tell.

Borg is not alone in his ability to tell stories about fraud and embezzlement by church volunteers and staff in this country. When I was editing Church Executive magazine I made it my personal campaign to draw attention to what can only be described as a kind of pandemic of crime in churchesand often congregations wont reveal the fraud or prosecute the offenders. Jesus wouldnt want us to turn over a believer to the police, might be the refrain among many churches.

You might be reluctant to believe that church embezzlement is that frequent. But just go to Google Alerts and put in the phrase church fraud, as I have, and you will get weekly reports of one or two or three culprits caught stealing small and large amounts from their congregations. At the magazine I would run short summaries of these prosecutions every other month under the headline, Why Churches Need Internal Controls.

Cases involving churches are hard to prosecute, Borg said to writer Thornton. "You ask for a witness and it's like you're attacking their faith," Borg said. "The really good schemes make faith in God equivalent to faith in the program."

Churches also allow scammers to get closer to a big target market--the elderly, writes Thornton. There is approximately $13 trillion in stocks, securities and other financial products held by Americans over 60.

And with no money coming in, uncertainty about Social Security or anxiety over potentially-catastrophic medical costs, fear can drive them to seek safe, easy investments, he says.

The sums can be a few thousands of dollars, or run into the millions of dollars, such as the scam in Indiana. Charles Wilson writes for the Associated Press in the past week: Thousands of devout investors who lost savings after a southern Indiana brokerage persuaded them they were helping to build churches will get the last of their share of the money that's being repaid by the end of the year, the official overseeing the payback said Monday, a case that has been going on since 2005.

Link:
Want to get fleeced?--go to church. Part 1